The Comptroller Auditor General (CAG) said that RCom launched its GSM service in Delhi in deviation to DoT's guidelines and Airtel was found providing leased line to a company without verifying its authenticity.

RCom and Airtel declined to comment on queries in this regard. The CAG has also flayed the Telecom Enforcement, Resource and Monitoring (TERM) Cell for not taking penal action against a company named Sehgal Infotech in 2013, which was running an "unauthorised" international call centre since 2009, and against domestic call centre firm Spanco BPO services (SBSL) for operating even after expiry of its registration.

As per the auditor's report tabled in Parliament, Reliance Communications launched its GSM mobile services in Delhi NCR in February 2009 without prior demonstration of the lawful interception and monitoring (LIM) capabilities of its network in violation to DoT's instruction issued in May 2008.

The CAG said that non-adherence to meeting the LIM requirement has serious implication on national security. "However, TERM Cell Delhi took action after two years (November 2011) and instructed RCL to submit the necessary Certificate without asking for any explanation regarding violation of terms and conditions of the Licence Agreement.

RCL submitted the necessary certificate in March 2012," the CAG said. In reply to CAG questions, the TERM Cell in September 2013 stated that no penal action has been initiated as there was no such provision in DoT order issued on February 14 2012 to RCL for demonstration of LIM facilities of GSM network.

The CAG said that DoT's reply on this matter is still awaited. "The reply of TERM Cell is not acceptable as breach of terms and condition of licence agreement would attract penal action and this was reiterated in the instructions issued in May 2008 and November 2011," the CAG said.

In case of Airtel, the auditor said that a company Alfa Flight was functioning as other service provider (OSP) without registration with TERM Cell Delhi by obtaining telecom resources from Airtel.

On the basis of a complaint forwarded by DoT to TERM Cell in June 2012, the inspection to locate the company and verify the reason as to why Airtel provided the resources to the company without verifying its authenticity as OSP but it could not establish presence of the company.

"The fact remains that TERM Cell took 7 months to instruct Airtel, January 2013, to disconnect all telecom leased Lines provided to the company illegally as it may be of grave security concern," the CAG said.

In case of unauthorised call centre operations of In case of unauthorised call centre operations of Sehgal Infotech and SBSL, the DoT has not replied to CAG's observation while the TERM Cell replied saying that there was no provision for penal action as per rules of Other Service Provider (OSP) registration.

The auditor rejected the reply of TERM cell saying that the vigilance function of TERM Cell stipulates that it should have control over clandestine or illegal operation of telecom networks by vested interests having no licence.

The TERM are also required to file FIR against culprits, pursue the cases, issue notices indicating violation of conditions of various Acts in force from time to time. "Therefore, TERM Cell failed to identify the illegal or unauthorised OSP activities, which was fraught with security risks," the CAG said.

The CAG has also pulled up TERM Cells for failure to impose penalty to the tune of Rs 4,300 crore on telecom operators for violating mobile tower radiation rules.

"Contention of DoT about manpower deficiency being the primary reason for delay is not acceptable as alleged shortage of manpower has been allowed to continue even after ten years," the auditor said.

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